EDMONTON — An Alberta construction industry leader is calling out the provincial government on outstanding payments from a controversial project.
On April 5, Alberta Construction Association (ACA) chairman Ian Reid sent a letter to then Alberta Minister of Infrastructure Sandra Jansen imploring the province to resolve outstanding payments to subcontractors who have not yet been compensated for their work on the Grande Prairie Hospital project.
“We acknowledge and applaud the leadership of your Government in addressing payment issues through your contracts. However, much of this good work now risks being undone because of the circumstances of one project,” Reid wrote, days before the provicinal election, which ousted the NDP.
“We understand that more than two dozen contractors are seeking redress in the tens of millions of dollars on outstanding payments from the Grande Prairie hospital project. Some of the affected contractors indicate that payment has been outstanding in excess of 300 days.”
Outstanding payments include work that has been certified for payment but not paid, Reid added, and pointed to the provincial government placing funds into court as inadequate and not following the spirit of the contract documents, which stipulated making payments in a timely manner.
“There is no guarantee as to how long the courts will take to conclude the process. It is also not clear the process and timeline to resolve the difference between the total claimed and the amount currently made available,” Reid said. “The protracted payment period puts the financial survival and livelihood of many Albertans at risk, for circumstances that are beyond their control.”
Reid also said his association and others appreciate working with the provincial government on public projects and do not seek the limelight, but that they feel compelled to speak out on behalf of “our members, their employees and their families.”
The Grande Prairie Hospital project has long been a lightning rod of controversy for the province and the industry. The Alberta government terminated its agreement with Graham Construction, the then- builder of the Grande Prairie hospital in September 2018. Jansen previously stated to the press that the government had directed Graham to submit a revised building plan in July 2018 but did not think the revised blueprint went far enough. The contract with Graham began in 2011 with the former Progressive Conservative government with an initial cost of $250 million. The cost of the project later ballooned to $753 million.
Graham said in a statement following termination from the project that the company was deeply disappointed by the Government of Alberta’s actions and that it had warned the ministry that the hospital could not be completed under the current budget given design changes requested, which it said included more than 600 change orders and more than 400 design clarifications.
At the time Graham left the project it was 75 per cent complete. Alberta Infrastructure announced in November 2018 that Clark Builders would act as the new construction manager.
This is very similar to the Medicine Hat Police Station project.
A majority of the trades (including me) have not received the 10% holdback due to a legal dispute between the City of Medicine Hat and the General Contractor.
We continue working for and maintaining good relationships with the GC and the City of Medicine Hat but there has to be a mechanism to prevent the trades from being involved in these legal issues.